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[SOLVED] Undelivered mail to a distribution list

I recently upgraded to 5.0.5 (instigated by another issue) and since then one of our users is experiencing some oddities. Among them is all received e-mail is in text format, despite having all settings for HTML checked that we can find in the personal settings area and his account in the management site.

The more important issue that has cropped up is all his mail to internal distribution lists are getting returned: